Barclays just published a survey of investor firms with $7.7
trillion in assets and $900 billion invested in hedge funds, and
57% of respondents said hedge funds had underperformed of late
because of "macro conditions."

Which macro conditions, you ask? The chart below from Barclays
shows how correlation and dispersion affect hedge fund returns.
Correlation is the degree to which different stocks in the
S&P 500 move in the same direction, and dispersion is the
difference in stock movements regardless of whether they are
moving in the same direction.

Barclays

The chart on the left shows the amount of performance hedge funds
were able to generate in different market conditions from 2000 to
2015. They generated 9.9% of alpha, or outperformance, when
dispersion was high and correlation was low — and very little
when the reverse was true.

The chart on the right shows that right now we're in the latter
kind of environment. Correlation is high, and dispersion is low.
In other words, it is hard for hedge funds to make money.